Market Comment (June 2024)
Let's just touch on the Euros. Yes, Scotland are already home, and England have been far from impressive in the group games, but they are through to the knockout stage. Just as well there are other things to keep your mind occupied, such as how the housing market is faring as we run head-first into the summer of 2024.
The General Election looms over everything
Understandably, alongside the Euros, there is considerable focus on the General Election, with Rightmove focusing on how things have changed for first-time buyers (FTBs) since the last big vote.
Their study suggests the average first-time buyer mortgage payment has risen by 61% since 2019. Then, the figure stood at £667 per month but now, the average mortgage payment for a FTB stands at £1,075.
To place this rise into context, over this time-frame, average wages have risen by 27%.
Tim Bannister from Rightmove said: “As rates have increased over the last five years, the amount that a typical first-time buyer is paying each month on a mortgage has outstripped the pace of earning growth. Some first-time buyers are looking at extending their mortgage terms to 30 or 35 years to lower monthly payments, or looking at cheaper homes for sale so that they need to borrow less. If mortgage rates are reduced, this will help first-time buyers in the short term more so than election housing promises.”
First-Time Buyers looking further afield to get on the property ladder
Following on from the revelation FTBs pay much more than their equivalents five years ago, a separate study suggests FTBs are looking further from their preferred location to afford a property.
Moneybox spoke with 1,000 would-be homebuyers, and 39% of respondents are looking for homes in adjacent areas to where they live right now.
There are many reasons why people are willing to move beyond their local area. 66% of respondents said they are happy to move so they can enjoy a garden while 53% are happy to move further away to have a spare bedroom. 48% of respondents cited an ensuite bathroom for the reason why they expand their bathroom, 47% list a driveway and 44% are happy to move to have a garage.
There are also factors like quiet surroundings, said by 38% of respondents and lower crime rates, cited by 32% of would-be buyers.
Brian Byrnes, Head of Personal Finance at Moneybox said: “Market volatility over the last few years has really highlighted how compromise is often the key to getting on the property ladder as a first-time buyer. It's great to see how first-time buyers have been adapting to make their dream of owning a home a reality and we see this resilience and commitment every day among our customers.”
Should first-time buyers dominate housing market focus?
Given the first two stories in this month's column focus on FTBs, it’s fair to say a lot of time and energy in the market falls on this sector. However, a study by Home Sale Pack suggests the market as a whole thinks the focus is fair enough.
The survey asked if the government gives too much priority to FTBs and 51% of respondents said the balance was right, while 49% say yes.
Where there is widespread belief is that 83% of respondents say a greater focus should fall on addressing the issues that impact all the housing market, not just FTBs. 93% of respondents believe there needs to be a greater level of security to reduce the number of fall-throughs which occur after the owner accepts an offer.
Ruth Beeton is a co-Founder of Home Sale Pack, and she said: “This government, and many that have come before it, don’t seem to have any real understanding of what people want when it comes to housing policy. There is, of course, a need for more stock in order for more people to be able to find a suitable home of their own, but this does nothing to address the crippling inefficiencies within the buying and selling process that are causing frustration and financial jeopardy for so many buyers and sellers alike.”
If you would like to learn more about Leytonstone, what the area has to offer, and how to achieve your goals in the local property market, we can help. To arrange an appointment, call us on 020 8558 1147 or send us an email at info@tradingplacesproperty.com
You will find Trading Places Estate and Letting Agents at 46 Church Lane, Leytonstone, London, E11 1HE; and we look forward to assisting you.
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